Daily Market Commentary

Stocks begin week with a 17-point advance

Published On: April 12, 2021 07:18 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, April 12: The Nepal Stock Exchange (Nepse) traded in red briefly in the morning with the benchmark edging 2 points lower. However, stocks saw upbeat movement after mid-day. The index traded around 15 points higher throughout the afternoon finally ending session at 2,691.56 – up 17.20 points against Thursday’s close.

With a gain of 17 points on Monday, Nepse has held ground above 2,600 mark for 8 consecutive days. Hence, buying enthusiasm has kept the market from making any major correction of late. Strength seen in different sectors in different periods have helped the index consolidate above 2,600 mark. Market participation has also remained upbeat of late. Over Rs. 7.61 billion worth of equities changed hands on the day. 

Sectors ended mixed. Gains came mainly from Microfinance sector as the group’s sub-index jumped 3.64%. Development Bank, Non-Life Insurance and Life Insurance sectors followed suit with advances of over 1% each. Banking, Manufacturing & Processing and Mutual Fund indices also inched higher. On the other hand. Hotels and Tourism and Trading sector fell the most and lost almost 2% each. Hydropower index dropped 1.63%, while ‘Others’ sub-group closed 1.42% lower. Investment and Finance sectors saw modest losses. 

NIC Asia Bank Ltd was the most actively traded stock of Monday with a turnover of Rs. 251 million. Nabil Bank Ltd closely followed with a transaction of over Rs. 245 million. Nepal Infrastructure Bank Ltd and Nepal Bank Ltd also saw heavy trading with turnovers of over Rs. 221 million. Grameen Bikas Laghubitta Bittiya Sanstha, Upper Tamakoshi Hydropower Ltd, Chhimek Laghubitta Bittiya Sanstha Ltd and Nirdhan Utthan Laghubitta Bittiya Sanstha were among other heavily traded stocks. 

NIC Asia Laghubitta Bittiya Sanstha Ltd and Mahila Laghubitta Bittiya Sanstha Ltd were the leading stocks of the day rallying 10% each. Chhyangdi Hydropower Ltd, Jyoti Life Insurance Ltd and Sindhu Bikash Bank Ltd also saw strength and surged more than 9%. Besides, mainly microfinance stocks dominated the list of top gainers. Excel Development Bank Ltd also rose 8.59% after the Class ‘B’ finance institution announced 12% bonus shares for the year 19/20.

Sanjen Jalavidhyut Company Ltd and Himal Dolakha Hydropower Company Ltd, on the other hand, were the major laggards. Both scrips fell around 4% each. Other energy stocks followed suit. United Modi Hydropower Ltd, Universal Power Company Ltd and Rasuwagadhi Hydropower Company Ltd also slumped more than 3% each. Reliance Finance Ltd, Chilime Hydropower Company Ltd, Khani Khola Hydropower Co. Ltd and Shiva Shree Hydropower Ltd were among other top losing scrips. 

In terms of ARKS technical analysis, the index formed a small bullish candlestick on the daily timeframe reflecting buyers control in the session. However, gains have remained modest in the recent trading days suggesting slight loss of momentum in the current zone. Nonetheless, with the index making a fresh high, the overall uptrend has remained intact. A correction can see the index test support at 2,650 mark. 

This column is produced by ARKS Capital Advisors Ltd.

(Views expressed in the article are those of the producer and do not necessarily reflect those of this publication)

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